AUTOMOTIVE IndUsTrY In MExIcO Ready to Overtake - ProMéxico

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driving towards
Increased Profit
Like every single big business, Daimler Trucks Mexico was hit by the world economic
crisis. But through hard work, perspiration and inspiration –not to mention a superbly
effective partnership between German, American and Mexican management and a
willing and highly-skilled workforce– the company has ridden the hard times and now
looks forward to a renewed, long and successful period in Mexico.
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by graeme stewart
photos courtesy of daimler trucks mexico “Mexico is a wonderful place to do business because of its close
Teutonic-American efficiency and Latin flair may not be
a combination that springs easily to mind but it is that
very partnership that has accelerated Daimler Trucks
Mexico on the road, being profitable, even when the
market fell by 60% in 2009.
Led by its truck division, Daimler has turned the corner and its
future in Mexico seems secure and healthy as the company has a
preeminent position among Mexico’s auto producers and exporters.
That, of course, is good news for the company but it is perhaps
even better news for Daimler’s over 4,600 Mexican employees
who have worked hand in hand with management to ensure the
company’s continuing success in the Latin American country of
its choice.
Yet the turnaround in fortune comes as no surprise to Gerhard
Gross, the dynamic President and CEO of Daimler Trucks Mexico,
who confirms he had every confidence that the partnership be-
tween him, his management team and enthusiastic labor force
would succeed.
Gerhard Gross enthuses: “The economic crisis was something
we had no control over. But what we could control was making our
Mexican operations fit to handle the crisis. The response was superb,
aided and abetted by a government that is very business-oriented.”
Working with Mexico is something Daimler can talk about.
Daimler started back in 1985 by selling diesel engines to a Mexican
truck manufacturer, and is now growing at the rate of 43% annually,
making it the dominant player in its field in the country. The company
has plants in Santiago Tianguistenco, Estado de México where
2,050 employees manufacture trucks for the domestic and foreign
markets and in Saltillo, Coahuila where 2,300 employees do the
same as their colleagues in Santiago Tianguistenco. Its Spare Parts
Center is located in San Luis Potosí and headquarters in Mexico
City with a total of 250 employees.
proximity to the US, the quality of its workforce, low labor costs and
its wide network of free trade agreements,” Gross explains.
“We now export over 90% of our Mexican-manufactured trucks
to the US, Canada and several Latin American countries; we have
a close relationship with Mexican colleges from where our engineers
graduate. Mexico, as part of the North American Free Trade
Agreement, is a great boost to our business. It makes exporting to
the US and Canada so much easier. We also export to countries
throughout Latin America, namely Chile, Peru, Ecuador, Colombia
and Central America. Only Brazil comes close to matching Mexico
as a preferred Latin America base and in terms of quality and
productivity, Mexico is still several steps ahead of Brazil,” he adds.
The importance of Daimler to the Mexican economy is highlighted
by the fact that the company uses 125 local suppliers and the
good news, according to Gross, is that it is looking to take on more.
“We are very happy with our local suppliers and, as far as we
are concerned, the more local suppliers we can take on, the better.
The same goes for engineers. The standard of engineers in Mexico
is excellent but we need more. It isn’t the end of the story when we
hire them, just the beginning. Once hired, they are placed on an intensive
training course and have to meet Daimler’s high demands
before starting work,” Gross says.
Gross points out that while the company is doing better, there is
still a long way to go before he can be fully satisfied with its overall
performance. “As far as trucks go, the average age of the Mexican
truck fleet is 17.7 years and that means that in the not too distant
future, a total of 126,000 trucks will need to be replaced. There is
still a lot of work to be done,” he explains.
With the expertise of the giant German company and the willingness
and skill of its Mexican workforce, who would bet against
Daimler Trucks Mexico accelerating ahead of the pack to increase
its lead in the automotive market? n
www.daimler.com
www.freightliner.com.mx